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Suppose an economy is described by the following equations

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Reference no: EM131709271

Suppose an economy is described by the following equations:

C = C0 + MPC (Y-T) = 100 + 0.4 (Y-T)

I = 250

G = 300

T = 200

NX = 0

Government spending falls by 200. How much does the equilibrium Y decrease?

Reference no: EM131709271

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